The National Association of REALTORS® reached a proposed agreement — which now has preliminary approval — to resolve a portion of nationwide claims brought by home sellers. NAR’s agreement would end a litigation of claims brought on behalf of home sellers related to broker commissions and preserve consumer choice and protect members.
The agreement would resolve claims against NAR, over one million NAR members, all state/territorial and local REALTOR® associations, all association-owned Multiple Listing Services (this includes the Greater Lehigh Valley Multiple Listing Service), and all brokerages with an NAR member as principal that had a residential transaction volume in 2022 of $2 billion or below.
You may have seen a lot of chatter in the news and on social media, in addition to attempts to interpret what all this means. To cut through the noise, we’ve compiled the resources and information that matters to you and your clients – right now.
Greater Lehigh Valley REALTORS®
Yes. Staff with the Greater Lehigh Valley REALTORS® will hold a free webinar from 10 a.m. to 12 p.m. on Tuesday, July 30, 2024.
Join Justin Porembo, CEO, Mallory Siegfried, Acting Director of the MLS, and Allyson Lysaght, Director of Professional Development, for a webinar discussing the upcoming changes to the GLVR MLS under the NAR settlement agreement.
Business will be changing come August, and there are a lot of questions. What can and cannot be put in the MLS? How do you communicate compensation? What do you do with existing contracts to make sure you’re in compliance with new MLS rules? What ARE the new MLS rules?
This webinar will help you feel more comfortable and confident when these changes affect your local MLS in August.
Registration is open at https://ims.glvr.org under Events.
Yes. The Greater Lehigh Valley REALTORS® Board of Directors on May 2 approved a motion to submit the REALTOR® MLS “Opt In” Agreement (Appendix B). If the association and MLS agree to implement practice changes, filing the opt-in agreement by the specified deadline (which was done) will remove any liability or threat of litigation for GLVR under the class action suits.
The Greater Lehigh Valley REALTORS® Board of Directors on June 6 approved the revised local MLS Rules and Regulations that now include mandatory MLS policy changes. The updated MLS Rules and Regulations will not be put into practice until August 5, 2024.
- Click here to review a summary of the MLS policy changes, provided by the National Association of REALTORS®.
- Click here to review a marked-up version of the GLVR MLS Rules and Regulations.
Sub Agency, Buy Agency, Trans Broker, and Dual/Var will be removed from the MLS input on August 5, 2024.
No.
Section 6.1 of the MLS Rules & Regulations — Compensation Specified on Each Listing — remains in effect until August 5, 2024.
Participants shall continue to communicate an offer of compensation to other MLS participants in the form of a percentage of the gross sale price or a flat dollar amount, including $0.00.
Pennsylvania Association of Realtors®
Yes. Due to the settlement, multiple PAR standard forms must be updated. Drafts of the revised forms were made available to members on July 1. The revised forms will go live August 1. Click here to review the draft forms and a comprehensive guide of the changes.
Yes. PAR will hold three general membership webinars to discuss the new rules and how to implement the revised forms into their businesses. PAR Chief Legal Officer Hank Lerner and PAR Associate Counsel Kacy Clouser will review these changes. The webinars will be held at 10 a.m. on Tuesday, July 16; Wednesday, Aug. 7 and Friday, Aug. 23.
Click here to register for one of the webinars.
These agent webinars will be recorded and posted on PAR’s website.
Yes. PAR has published a settlement resource on PARealtors.org.
National Association of REALTORS®
- facts.realtor (the go-to resource hub for the latest updates; includes fact sheet, settlement agreement facts toolkit, settlement FAQ, financing FAQ, MLS policy changes, legal documentation of the settlement, settlement overview, settlement timeline, opt-in agreement forms, press releases, videos, briefings and a podcast episode from NAR leadership and staff)
- NAR secured in the agreement a mechanism for nearly all brokerage entities that had a residential transaction volume in 2022 that exceeded $2 billion to obtain releases efficiently if they choose to use it.
Broadly speaking, the opt-in provides two paths:
* Option 1: A brokerage can elect to pay an amount based on a predetermined formula based on that brokerage’s residential transaction volume.
* Option 2: A brokerage can elect to participate in non-binding mediation within 110 days following preliminary approval of the settlement.
* Brokerages can also choose not to participate in this settlement.In order to be released under the settlement, eligible brokerages must agree to and execute Appendix C – Brokerage “Opt In” Agreement and return it—along with the required documentation and indication noted in paragraph 20 of Appendix C—to the email addresses realtorsoptin@jndla.com, realtorsoptin@cohenmilstein.com, and nargovernance@nar.realtor within 60 days of the filing of the motion for preliminary approval (by June 18, 2024).
All agreements reached through this mechanism would be subject to court approval.
Brokers should discuss the final bullet point section with their legal counsel.
Q: Are REALTORS® who deal in commercial real estate covered under the terms of the agreement?
- The settlement does not distinguish between REALTORS® who deal in commercial real estate from those who work in residential real estate.
- If you are an NAR member, you are covered by the settlement unless:
- You are an employee of: At World Properties, LLC; Compass, Inc.; Douglas Elliman, Inc.; Douglas Elliman Realty, LLC; eXp Realty, LLC; eXp World Holdings, Inc.; Hanna Holdings, Inc.; HomeSmart International, LLC; Howard Hanna Real Estate Services; Keller Williams Realty, Inc.; Real Broker, LLC; The Real Brokerage, Inc.; Realogy Holdings Corp.; Realty ONE Group, Inc.; Redfin Corporation; RE/MAX, LLC; United Real Estate; or Weichert, Realtors® OR
- You are an independent contractor or employee associated with HomeServices of America or one of its affiliates.
Q: What do these practice changes mean for commercial practitioners?
- The proposed settlement agreement—like the Sitzer-Burnett lawsuit and the copycat lawsuits—is focused on residential real estate transactions. That means most commercial transactions will not be affected.
- In many markets, commercial listings appear in commercial information exchanges (CIEs) and not multiple listing services (MLSs), and do not include an offer of compensation.
- The settlement prohibits offers of compensation on the MLS and requires MLS participants working with buyers to enter into written agreements with their buyers. These practice changes will go into effect around late July.
Commercial practitioners can get more resources at commercial.realtor.
REALTORS® are still worth it, and you — the membership — should continue to positively promote the importance of utilizing a REALTOR® during real estate transactions! To do this, check out the Settlement Agreement Facts Toolkit available at facts.realtor.
In addition to sharing the facts about the proposed settlement, the membership is encouraged to utilize social media assets that can be shared with their networks. You can find sample social media copy (text) and creative (graphics) within the Settlement Agreement Facts Toolkit.
Members can help challenge inaccurate information they see appearing in social media posts, news articles or elsewhere. A list of settlement myths and how to answer them are available on REALTOR® Magazine’s website. Bookmark this article and familiarize yourself with the content so you can help correct inaccurate information online and in-person.
For additional content to promote beyond the settlement agreement, visit ThatsWhoWeR.realtor to view NAR’s consumer campaign ads. The campaign demonstrates the expertise of REALTORS® helping their clients navigate the risks, pitfalls, and complexities of buying or selling a home or property, reinforcing their expertise, commitment, and consumer-first approach.
Please utilize the reliable resources available to you and help spread the word that working with a REALTOR® is worth it.